Housing Associations (Neasden) (Hansard, 21 October 1988)

§ Mr. Ken Livingstone (Brent, East)

This issue should not be a source of contention between the parties because it relates to a community in my constituency which shares many of the values that have been severely eroded in other parts of our society. This long-established community is known as Neasden village. It has housed three generations of London Transport workers who have served the community well and from whom we have seen many examples of community service that we would like to spread to the other major cities where that sense of community no longer exists.

The community is seriously threatened by a pernicious property developer, and I fear that what is happening in Neasden will happen in many other areas when the Government's housing legislation, which is still before Parliament, becomes law.

Neasden village consists of 272 homes spread over four streets in a fairly isolated area. It was developed in two phases, with 142 brick houses and 130 concrete houses. As one would expect, the concrete houses need more repairs than the brick houses. The uniqueness of the estate is recognised by the fact that the local council has declared it a conservation area.

The first appalling decision in this case was that of London Transport more than a year ago not to maintain those houses and provide homes for its workers but to sell them on the open market. Given the problems that we are told London Transport has of finding people to drive its trains and buses, it is breathtaking that such an estate should have been put on the market. The Government, through the Housing Corporation, and Brent council backed a reputable local housing association that wanted to purchase the properties and continue to run them in a reponsible fashion. Unfortunately, it was gazumped. A property developer was prepared to pay more than the market rate, determined by the district valuer and the council, and the reputable housing association was unable to buy the houses. The estate passed in to the hands of Asda Securities Ltd.

There is a major problem in terms of the Government's policy for funding housing associations through the Housing Corporation. Housing associations are restricted by the real market value of occupied properties, but a property developer can look at the same properties and estimate how many of the tenants can be winkled out. He can see the longer-term potential for development by emptying the homes and selling them on the open market. So housing associations are hamstrung when in competition with the less desirable property speculators.

The same day that Asda Securities bought the properties it immediately sold the concrete homes—130 of them—to a firm called Unicoin (Neasden) Ltd. The tenants in the homes passed into the loving care of their new landlord, a Mr. Sturt. His approach to housing management seems to have been largely influenced by the activities of the American Mafia, and I am sure that no hon. Member of any party would find his approach desirable or worthy of emulation. Since Mr. Sturt took 1195 over, no repairs have been done. He immediately applied for a £10 a week rent increase, but on appeal from the tenants that was reduced to £1.50.

Then there started a series of harassing visits. Many of the tenants, who are now elderly, received calls at odd times of the day urging them to move and warning them that major disruption would be caused by development works in the area. Confusion and doubt were spread among the community. All sorts of disturbing rumours abounded, but no real information. Mr. Sturt opened no genuine channel of communication with his tenants. He started offering sums of money to tenants to move out. Tenants who resisted have in some cases been offered as much as £15,000. That sounds like a reasonable sum but I can assure the House that a one-bedroom flat in my constituency usually goes for about £60,000. So what good would £15,000 be to a family that had lost its home? It would eventually become a burden on the local council and have to occupy bed and breakfast accommodation. What use would £15,000 be to a pensioner who would have no chance of getting a mortgage to take him up to the £60,000 which is the going rate in Brent?

Mr. Sturt found that, by and large, tenants were not interested in his offer, so he chose to up the pressure—which is why I referred earlier to the Mafia style of housing management. At 6 o'clock one morning this June a group of men claiming to be building workers arrived in the area, climbed on to the roofs of the properties and started to rip the tiles off, throwing them down through the buildings and thus causing even more damage. They started with the properties that Mr. Sturt had kept empty throughout the previous year but they moved on to occupied properties, ripping away the gable tiles and allowing water penetration into occupied homes. Mr. Sturt was achieving his objective: having failed to bribe or harass the tenants to move out he was now engaging in a physical drive to do so by demolishing the houses around them. That was completely illegal, as the place is a conservation area. He broke the law to achieve his ends. Brent council issued a notice that he should desist from his activities, with which he eventually complied.

Since then, Mr. Sturt has taken no action to repair the properties from which his building workers ripped the roofs, and deterioration continues. Moreover, tenants wonder whether a landlord who is prepared to behave like this will not have other extremely unpleasant tricks up his sleeve. Mr. Sturt then had the remarkable gall to say that he would not meet the tenants because they were behaving like a lynch mob. If so, they had my sympathy. Mr. Sturt's housing management record stretches my opposition to capital punishment to the point at which I might be able to make an exception: the limited reintroduction of hanging for this sort of landlord.

Mr. Sturt then applied for planning permission, having recognised that the council would not allow him to demolish the properties illegally. He has now applied to demolish all 130. Where will the tenants living in the properties that are still occupied be rehoused by Mr. Sturt? A community that has lasted three generations is now to be thrown to one side so that Mr. Sturt can make a fast speculative profit with half the homes in a conservation area. He intends to replace them with buildings of different heights, completely altering the nature and scale of the conservation area. The development would consist of 392 yuppie flats and bedsits. If the right hon. Member for Brent, North (Sir R. Boyson) were with us today he would 1196 confirm that there is tremendous traffic congestion in this area. The site borders the Neasden roundabout and a busy junction with the north circular road. No member of any political party would support the idea of many yuppies and cars coming into an area that is already a nightmare of traffic congestion. I am sure that opposition to that would unite all the members of Brent council.

The House will be interested to know that Mr. Sturt does not share the Prime Minister's commitment to the environment, which she recently expressed in a speech. He intends to demolish the mature oaks and silver birch trees that have grown on the site over three generations to make way for the maximum number of new tacky homes that he can squeeze into Neasden village.

What should the House ask the Government to do? I appeal to the Minister to consider several matters. The House should say that these homes should be repaired. Simply to demolish homes that have been neglected, especially by a landlord who refuses to repair them, is not the answer. If a house needs to be demolished because there is no possibility of repairing it, it needs to be sensitively replaced so that it blends into the existing community.

The Government face a choice in terms of their funding of housing associations. They can give associations the freedom to bid against the speculative developer and go beyond the price agreed by the district valuer. None of us would welcome that because it would mean spending more public money in a market where property speculators endlessly bid up prices. The alternative that I recommend to the Government would cost nothing extra. It is to support compulsory purchase orders placed by the local council on properties such as those at Neasden, but with the specific agreement that instead of control passing to the council the properties would automatically be sold as soon as the council's compulsory purchase order was confirmed by the Government. They would be sold to a reputable local housing association or to the tenants who could buy them individually or collectively. That would achieve for private tenants what public sector tenants have been given in the right-to-buy legislation—the ability to determine the ownership of their properties. I have no doubt that that would receive overwhelming public support in areas of the country where bad landlords continue to abuse their tenants.

I ask the Government to look at how easy it is for people such as Mr. Sturt to get away with these activities. The penalties for the illegal activities undertaken by Mr. Sturt in a conservation area are laughable. No doubt he could make £30,000, £40,000 or £50,000 profit per property on the sites where he has illegally tried to demolish these houses. No financial penalty imposed by the courts could ever deter people such as Mr. Sturt. He will laugh all the way to the bank. We should compare the penalties that he might face to the penalties being imposed by courts for insider trading in the City where financiers face long prison sentences. An insider trader indulges in evil activities that disrupt people's financial lives, but is it not worse that homes and communities should be disrupted by Mr. Sturt?

We know about the doubt and confusion felt by a person who is mugged on the street. Mr. Sturt's activity damages people's lives by causing worry, confusion and doubt, and the pain felt by many of his tenants ranks with the damage caused by the mugger on the street. When dealing with such vandals we should hand out heavy 1197 prison sentences. I hope that the Minister will look at the severity of the penalties that are available. The only deterrent to people such as Mr. Sturt is the knowledge that they will be put inside for two or three years. We also need to find ways in which we can assist tenants to prosecute their landlords when they refuse, month after month, to carry out repairs.

This is not a party matter. I do not think that any Tory Member would support the activities of people like Sturt any more than they supported the activities of people like Rachman. We should be able to unite against such characters. I know that the Minister will not be able to give a commitment now, and will say that these matters will have to be considered. If Brent council seeks to put a compulsory purchase order on these properties, I beg him to say that the Government will consider that favourably. It would be a warning to many others of Mr. Sturt's inclination if the House were united beyond party divisions to make sure that bad landlordism like this is not allowed to destroy established and respected working class communities.

§ The Parliamentary Under-Secretary of State for the Environment (Mr. David Trippier)

I congratulate the hon. Member for Brent, East (Mr. Livingstone) on having obtained this debate and spoken on so important a subject. It is extremely gracious of him to say that he understands that the Minister cannot give a commitment, because that is certainly true. It is an interesting exercise for Ministers to guess or second-guess what hon. Members will raise in detail in their Adjournment debates. I was unaware of the vast majority of what the hon. Gentleman told us. I can give him the assurance that I will look at it, but the councils and the tenants to whom he has referred, who are involved in this case, should exercise the legal remedies available to them. I am handicapped by not being able to comment on that because the matter may come before the courts and there may be some legal redress. As the hon. Member has gone wider in his comments by talking about funding, I shall say something about that and return to the specific point about the village later. In this case, it may not have made as much difference as he suggested, but that is a matter for conjecture and not of fact.

The housing association movement has a long and honourable tradition with its rare, if not unique, combination of social awareness and enterprise. In the hon. Gentleman's constituency, the housing association movement has a long and proven track record, with some of the most distinguished and active housing associations in the country. They include the Brent people's housing association, now called the network group, the Paddington churches housing association and the metropolitan housing trust. Others have earned a well-deserved local reputation, often catering for special needs.

In Brent, housing associations own about 6,900 homes—about one third as many as the council, which is a high figure—and more than 7 per cent. of the entire housing stock. There are few aspects of housing provision in which the associations are not involved. They buy property, improve it to the standards that we now expect, convert 1198 properties into self-contained flats, and house the homeless and those in special need. I shall come to examples of those later.

The hon. Gentleman is aware that the Government pay grant, known as housing association grant, for approved projects carried out by housing associations that are registered with the Housing Corporation, and this is a capital grant. In 1987–88, the total amount paid was £886 million. This went towards the cost of buying land for development, buying standing properties for use as housing, building work, professional fees and interest on the cost of the projects. There are two routes for applying for grant—through the local authority or to the Housing Corporation—and loan finance may come from either source. When we drew up our recent proposals, we saw an advantage in making the corporation the sole funding agency.

The hon. Member for Brent, East suggested that more money should be made available to housing associations. If the means whereby that could be made available were through the housing association grant, he is clearly looking to the Government—at the moment, there are negotiations with the Treasury—for an increase in future years' allocation for such an exercise. It may be we would agree on that. There may be no political difference between us on that. What interests me in the debate is whether, had there been additional money available for the housing association to which the hon. Gentleman referred, it would have changed the situation. I am allowed to comment on that.

Although the hon. Gentleman is understandably concerned over what has been happening at Neasden village, where the network organisation was unsuccessful in bidding for houses sold by LRT, the figure that the association bid was obviously a matter for its own judgment, based no doubt on qualified professional advice. Naturally, I do not have knowledge of the association's finances, but even if it had had the funds available it does not necessarily follow that it would have increased its bid for the properties. It could have taken the view that expenditure at that level would produce a poor return in housing terms compared with other projects it might have carried out. I ask the hon. Gentleman to accept that that is possible: Perhaps we need to explore that further.

As the village is a conservation area—the hon. Gentleman referred to that—demolition of any of the buildings will require the consent of the local planning authority or of my right hon. Friend the Secretary of State. As the hon. Gentleman knows, it would be wrong for me to speculate on the future of the village in that sense because the Department plays a semi-judicial role in that respect. However, I can give him an assurance that what he has said will be taken into account when we consider the matter.

On the subject of the tenants, hon. Members will know of the existing legal safeguards against harassment and of our proposals for strengthening them in the Housing Bill. I do not expect the hon. Gentleman to accept all that we are seeking to do in the Bill and he has already spoken about that. However, as far as I am able, I can give him the assurance he seeks that I shall consider the matter. If he wishes to come to the Department of the Environment, I am prepared to meet him to discuss the subject. It would be unwise at this stage to go further.